Category Archives: Benefits

From the press release:
State and local pension plans have consistently been able to meet their benefit and other payment obligations over the past quarter century, according to a data analysis published November 16 by the National Conference on Public Employee Retirement Systems.

Between 1993 and 2016, contributions and investment earnings by 6,000 public pension plans exceeded benefit obligations in all but four years. And during those four years – 2002, 2008, 2009, and 2012 – all plans met their obligations in the aftermath of recessions because they had built up cushions during normal times, according to the analysis conducted by Michael Kahn, director of research for NCPERS.

The findings offer a striking counterpoint to initiatives under way in some states and municipalities to dismantle public pensions because they are considered under-funded, said Hank H. Kim, NCPERS’ executive director and counsel. ….

Critics of public pensions often cite funding ratios of less than 100% as evidence of pressing financial problems, but this is faulty logic, Kim said. Contributions and earnings continue to flow into plans even as benefits are being paid out, he noted. ….

Kahn found that individual states – regardless of whether their pension plans were underfunded or fully funded – had between five and eight years in which income fell short of obligations, and had to draw on their cushion to pay benefits. Far from being a cause for concern, “this is exactly what public pensions are designed to do – to provide a steady income over the long haul,” Kahn noted. “Pension assets typically are invested over a 30-year time horizon, so plans aren’t blown off course by short-term market shifts.”

NCPERS offered four recommendations for public pension plans:
– Stop dismantling plans on grounds that they are not fully funded.
– Improve funding by determining the appropriate levels of required employer contributions.
– Establish a pension stabilization fund that can set aside money from a certain revenue stream to be used in special circumstances such as a recession.
– Implement a mechanism to ensure that full employer contributions are made on a timely basis, perhaps by making employer contributions a nondiscretionary part of the budget.

From the introduction:
Unlike in the private sector, nearly all employees of state and local government are required to share in the cost of their retirement benefit. Employee contributions typically are set as a percentage of salary by statute or by the retirement board. Although investment earnings and employer contributions account for a larger portion of total public pension fund revenues, by providing a consistent and predictable stream of revenue to public pension funds, contributions from employees fill a vital role in financing pension benefits. Reforms made in the wake of the 2008-09 market decline included higher employee contribution rates in many states. This issue brief examines employee contribution plan designs, policies and recent trends.

From the abstract:
California public pension plans are funded on the basis of policies and assumptions that can delay recognition of their true cost. Even with this delay, local and state governments are facing increasingly higher pension costs—costs that are certain to continue their rise over the next one to two decades, even under assumptions that critics regard as optimistic. As budgets are squeezed, what are state and local governments cutting? Core services, including higher education, social services, public assistance, welfare, recreation and libraries, health, public works, and in some cases, public safety.

From the tip sheet:
This survey provides national summary data on the revenues, expenditures and composition of assets of the largest defined benefit public employee pension systems for state and local governments. The report produces three tables: Tables 1 and 3 include data on cash and security holdings, and Table 2 provides data on earnings on investments, contributions and payments.

From the summary:
Time off to provide care for the health and well-being of a family member or for a worker’s own illness or injury is a near-universal need of workers from all backgrounds. Paid family and medical leave offers protection against financial hardship for employees requiring such time away from work to provide or receive care. The United States is an extreme outlier in its lack of a national paid leave program. In the absence of a national program, several states have established paid leave programs for medical and family caregiving needs. States have taken different pathways to creating their paid leave programs and have pursued different design options in terms of structure, funding, and program administration.

This brief discusses the current landscape of paid leave access, the history behind existing state-level programs, and policy considerations for states developing future paid family and medical leave programs. It begins with an overview of paid leave coverage in the United States, including a discussion of inequality in access to existing programs and benefits. This is followed by a discussion of the growing need for paid leave programs. The history of existing state-level policies is addressed through a description of the policy pathways and design choices that were made in the development and implementation of these programs. The brief then considers the benefits and challenges of various design options (i.e., program structure, funding, and administration) that states will weigh when designing new paid leave policy. Finally, the brief considers the current research on the economic and health impacts of paid leave programs, and discusses critical questions for future study.

From the abstract:
This annual survey of employers provides a detailed look at trends in employer-sponsored health coverage including premiums, employee contributions, cost-sharing provisions, and employer practices. The 2017 survey included more than 2,100 interviews with non-federal public and private firms. Annual premiums for employer-sponsored family health coverage reached $18,764 this year, up 3% from last year, with workers on average paying $5,714 towards the cost of their coverage, according to the Kaiser Family Foundation/Health Research & Education Trust 2017 Employer Health Benefits Survey. The 2017 survey includes information on the use of incentives for employer wellness programs, plan cost sharing, and firm offer rates. Survey results are released in a variety of ways, including a full report with downloadable tables on a variety of topics, summary of findings, and an article published in the journal Health Affairs.
Related:Press ReleaseSummary of FindingsSurvey Design and MethodsHealth Affairs
The peer-reviewed journal Health Affairs has published an article with key findings from the 2017 survey: Health Benefits In 2017: Stable Coverage, Workers Faced Considerable Variation in Costs.

Web Briefing
On Tuesday, September 19, 2017, the Kaiser Family Foundation and the Health Research & Educational Trust (HRET) held a reporters-only web briefing to release the 2017 Employer Health Benefits Survey.

Interactive Graphic
This graphing tool allows users to look at changes in premiums and worker contributions for covered workers at different types of firms over time: Premiums and Worker Contributions Among Workers Covered by Employer-Sponsored Coverage, 1999-2017.

Key Exhibits-Chartpack
Over twenty overview slides from the 2017 Employer Health Benefits Survey are available as a slideshow or PDF.

Additional Resources
Standard errors for selected estimates are available in the Technical Supplement here.
Employer Health Benefits Surveys from 1998-2016 are available here. Please note that historic survey reports have not been revised with methodological changes.
Researchers may request a public use dataset by going to Contact Us and choosing “TOPIC: Health Costs.”

In the United States today, paid family leave is an elite benefit: 94% of low-income working people have no access to paid family leave. Millions of Americans don’t get even a single day of paid time for caregiving. 1 in 4 new moms in the U.S. is back at work just ten days after childbirth. While public discourse often focuses on income inequality, there is another critical way families experience inequality: the inability to be with their babies and families for the most important moments of their lives.

Over the last year, a slate of the largest employers in the United States have announced paid family leave policies: Starbucks, Yum! Brands (KFC, Taco Bell, Pizza Hut), and others. While the media has largely heralded these announcements as a boon for working families, most of these benefits are only accessible for people who work in white-collar corporate jobs, leaving out the hourly employees who comprise the vast majority of a company’s workforce. In fact, overall access to paid family leave in the United States has actually declined over the last decade. We’ve conducted independent research to uncover the paid family leave policies at the largest employers in the country to understand who has access to family leave, who doesn’t, and what that says about the need for change in both corporate and public policy.

Many of the companies that employ the most people have policies that provide significantly more paid family leave to corporate employees, while offering little — or nothing at all — to hourly/field/part-time workers…..

….Unfortunately, Starbucks is correct when they argue that they provide better benefits than some. Walmart, Kroger, Nike, and Marriott are just some of the corporations offering no paid leave at all. Yum! Brands, owner of chains such as KFC, Pizza Hut, and Taco Bell, employs hundreds of thousands of US workers, and none of the staff working the restaurants get any paid leave. Yet birth mothers working in the headquarters get 16 weeks. At Amazon, it’s 20 weeks for full-time birth mothers and nothing for those in the warehouse. While all parents deserve adequate paid leave (a guarantee in so many other countries), there is something especially perverse about a company recognizing the need for its corporate employees while denying it to its lower paid staff—people who are much more likely to have trouble affording child care to being with.

The worst part? It doesn’t have to be this way. It is possible to treat your retail and corporate employees equally, to give part-time workers the same benefits of those working full-time while still flourishing. Wells Fargo and Nordstrom give all new mothers at least 12 weeks of paid leave, though they do give less to fathers and adoptive parents. Bank of America and Ikea give all new parents 16 weeks. These are huge companies with huge profits. If they can do it, why can’t others?….

Hawaii is the latest state to require regular analysis of the potential impact of future economic swings on its public pension funds. Known as stress testing, such calculations can help states monitor the fiscal strength and sustainability of these funds.

This spring, the Legislature unanimously approved a bill requiring the analyses, and Governor David Ige (D) signed it into law July 5. California, Virginia, and Washington already require extensive and routine sensitivity analyses on their public pension plans. Typically, these tests provide estimates of the future financial position of these funds under various economic and investment return scenarios. Interest among other states appears to be growing as well. ….

It has to be taken as a sign of progress that the presidential candidates of both major political parties talked about providing child care and paid family leave in their campaigns, for the first time in U.S. history. But despite this progress, the Trump administration’s child-care proposal is not comprehensive enough to be of much use to the large numbers of low-income families in great need. Trump’s child-care proposal is—surprise, surprise—another tax giveaway to upper-income taxpayers, disguised as an increased tax credit for struggling low-income families. The increase is vanishingly small for low earners. In response to Trump’s plan, Democratic Senator Patty Murray and Representative Bobby Scott drafted the Child Care for Working Families Act. A summary of the bill, expected to be introduced in full tomorrow, shows a more comprehensive plan for high-quality early learning and affordable child care.

Subsidized child care and paid family leave are crucial for American families because they have the potential to increase disposable family income and reduce poverty and inequality in a meaningful way. They are also essential for achieving gender equality, key for children’s well-being, and a stimulus to the economy. For all these reasons, any progressive or Democratic Party platform must include wide-ranging child care and paid family leave proposals. Trump’s plan doesn’t get us there, but as in many other countries with our wealth, we can and must humanize our economic system by building in time and resources for caring for our families…..

As many as 114 multiemployer pension plans covering nearly 1.3 million workers are severely underfunded and headed toward failure within the next 20 years.

The forecast, from a new analysis by actuarial consulting firm Cheiron Inc., draws on the latest annual financial reports filed by multiemployer pension plans with regulators. The troubled plans have total assets of $43.5 billion and liabilities of $79.9 billion, leaving unfunded liabilities—future benefit payouts promised to retirees and beneficiaries for which reserve funds have not been set aside—of $36.4 billion.
Related:Unfunded Liabilities of the 114 Failing Multiemployer Pension Plans
Source: Cheiron, August 2017
See also: Press release

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